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24 Cards in this Set
- Front
- Back
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What are the 3 economic questions?
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What should be produced?
How should it be produced? For whom should it be produced? |
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explain the traditional system
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decisons based on customs and beliefs from generation to generation
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explain the command system
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the government controls production
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explain the market system
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prices of goods and services are determined in a free price system
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What is the circular flow of economic activity?
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a model of how the market system works
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what is capitalism
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private individuals own the factors of production
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what is laissez-faire
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the government limits itself with the economy
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what are the 6 characteristics?
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1. little role of government
2. freedom of enterprise 3. freedon of choice 4. profit incentive 5. private property 6. competition |
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explain little role of government
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government has little interferance in the economy
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explain freedom of enterprise
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free to own and control production
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explain freedom of choice
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buyers make decisons on what is produced
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explain profit incentive
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desire to make money
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explain private property
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property that is held by individuals
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explain competition
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rivalry of producers with similar products
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Who is Adam Smith?
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an economist
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What did Adam Smith write?
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An Inquiry Into The Nature
Causes of The Wealth of Nations |
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What did Adam Smith do?
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he desribed a system in which government has a little to do with the economy
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what are the 6 goals?
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1. economic freedom
2. economic effiency 3. economic equity 4. economy security 5. economic stability 6. economic growth |
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what is economic freedom?
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allows society to make choices
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what is economic effiency?
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uses limited resources
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what is economic equity?
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fairness underscores
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what is economic security?
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protection against risks
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what is economic stability?
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to reduce extreme up and downs
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economic growth?
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expansion of the economy
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